OUTLOOK, Sask. – The Canadian Wheat Board isn’t about to voluntarily give up its role in regulating the grain transportation system.
And it says that’s because farmers want the board to stay involved.
“There are some views to the contrary, but many farmers I talk to have indicated that they see the board performing a very useful role in that whole area,” said wheat board commissioner Gordon Machej.
One of the issues in the upcoming review of the system will be whether to adopt a commercial system in which the movement of grain from country elevators to port positions would be left up to shippers and the railways.
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Following a July 25 meeting in Winnipeg, a number of industry officials said they favored such an approach, which would bring an end to the board’s planning and co-ordination role.
But Machej said in an interview the board is skeptical about such proposals.
“I’m not sure how that would work, quite frankly,” he said.
Based on its knowledge of sales commitments at export position, the board each week negotiates a car supply with the railways and works with the grain companies to make sure cars are sent to the right areas to pick up the right quantity and quality of grain from country elevators.
Some proponents of change say the board should simply receive grain at export terminals and leave it up to the grain companies and railways to make sure the right grain gets there at the right time.
“We think the country program can still be done in a more market-based environment if the wheat board communicates clearly with the companies as to what the customer desires, in the right time frame and at the right locations,” said Kevin Archibald, of the Western Canadian Wheat Growers Association, likening it to the movement of non-board grains.
But Machej said the grain marketing system is a series of links running from the customer back through the marketer (the CWB), the carriers, the shippers and the farmers.
“I haven’t had anyone clearly articulate to me how you improve that linkage if you remove the marketer from the chain,” he said.
Jim Robbins, a Delisle, Sask., farmer who attended the July 25 meeting as a producer member of the Car Allocation Policy Group, said while grain companies and railways favor the idea of making the board essentially a port buyer of grain, he doesn’t expect that will happen.
“I think it’s inevitable that the board’s role is going to alter, but I would be surprised if the board was completely out of transportation,” he said. “I don’t see any major marketers of grain that have nothing to do with booking and arranging transportation.”
Confidence essential
Machej said it’s important that farmers have confidence the rail system is working in their best interests, especially since they have no alternative way to get their grain to market. Having the board directly involved can help provide that assurance.
Those who favor fully deregulated commercial transportation should look south of the border at the high freight rates on grain moving from the northern Great Plains to export position in the Pacific Northwest.
“I don’t think that should be a result that one should strive for,” Machej said.
National Farmers Union president Nettie Wiebe said her organization wants the board to remain directly involved in transportation, including car allocation, to ensure that foreign customers get good service.
Complete deregulation will only put more power in the hands of the railways and the result will be higher costs and poorer service.
“We have no confidence that these private (rail) monopolies, in cahoots with the grain companies, are out there trying to save farmers a dollar and give us the best service possible,” she said.
Wiebe added it makes no sense to blame the wheat board for transportation problems when crops like canola, peas and lentils have suffered from the same shipping problems as wheat and barley: “Deregulation seems to have been equally bad for non-board grains.”
